Retiring baby boomers to slow long-term growth, study finds

April 28, 2010
Canoe.ca

Retiring baby boomers will dampen Canada’s long-term economic growth and the mass exodus from the workforce will result in a prolonged labour shortage that even high immigration numbers won’t make up, according to the Conference Board of Canada’s latest forecast.

Pedro Antunes, director of the Conference Board’s national and provincial outlook, said the near-term economic picture is much brighter than it was just a few months ago.

“Beyond 2014, however, economic growth will be restrained as the baby boomers leave the workforce. Labour shortages brought on by a wave of retirements will be the dominant economic trend until about 2030,” Antunes said in a release Wednesday.

Tight labour markets support high immigration volumes, the report said. Newcomers to Canada will top out at just over 350,000 per year in the final three years of the forecast, 2028 to 2030.

“Strong immigration will not reverse Canada’s aging trend, but it will help keep total population growth relatively stable throughout the forecast period,” it said.

By 2030, Canada’s population will reach an estimated 41.7 million, up from 33.6 million in 2009.

Over the medium term, the Conference Board expects a “robust increase” in real Gross Domestic Product. From 2012 to 2015, average real GDP growth should come in around 3.4% and the national unemployment could fall below 6%, it said.

Reference: Canoe.ca